When I sit down with families to discuss their life insurance needs, one of the most common questions I hear is “what is burial insurance?” It’s a straightforward question that deserves a clear answer, especially since this type of coverage plays such an important role in protecting families from unexpected financial burdens.
For a complete overview, see final expense insurance explained.
Burial insurance, also known as funeral insurance or final expense insurance, is a type of permanent life insurance specifically designed to cover end-of-life expenses. Unlike traditional term life insurance that might provide hundreds of thousands in coverage, burial insurance typically offers smaller death benefits—usually between $5,000 and $50,000—with the primary purpose of ensuring your final expenses don’t become a financial burden for your loved ones.
How Burial Insurance Works
The concept is simple: you pay monthly or annual premiums to an insurance company, and when you pass away, your beneficiaries receive a death benefit that they can use to cover funeral costs, burial expenses, outstanding medical bills, and other final expenses.
What makes burial insurance different from other types of life insurance is its focus and accessibility. These policies are designed with older adults in mind—typically those between ages 45 and 85—and often feature simplified underwriting processes that make them easier to qualify for than traditional life insurance.
The Application Process
Most burial insurance policies use what’s called “simplified issue” underwriting. This means:
- No medical exam required - You won’t need to visit a doctor or have blood drawn
- Limited health questions - Usually just 8-15 questions about your current health
- Fast approval - Many applications are approved within days, not weeks
- Higher acceptance rates - More forgiving than traditional life insurance
Some companies even offer guaranteed acceptance policies with no health questions at all, though these typically come with waiting periods and higher premiums.
Types of Burial Insurance
Not all burial insurance is created equal. Let me walk you through the main types you’ll encounter:
Simplified Issue Burial Insurance
This is the most common type. You’ll answer basic health questions, but won’t need a medical exam. The approval process is quick, and coverage is effective immediately in most cases.
Best for: People with minor health issues who can answer “no” to the health questions
Guaranteed Acceptance Burial Insurance
These policies accept everyone who applies within the eligible age range, regardless of health. However, they come with trade-offs:
- Graded death benefit - If you die from illness within the first 2-3 years, beneficiaries may only receive premiums paid plus interest
- Higher premiums - You’ll pay more for the guarantee of acceptance
- Limited coverage amounts - Usually capped at $25,000 or less
Best for: People with serious health conditions who can’t qualify for other coverage
Modified Whole Life
Some burial insurance policies are structured as modified whole life insurance, which means premiums may increase after the first few years but then remain level for life.
Best for: Younger applicants who want permanent coverage with initially lower premiums
What Does Burial Insurance Cover?
The beauty of burial insurance is its flexibility. Your beneficiaries receive a lump sum death benefit that they can use for any purpose, but it’s typically intended to cover:
Direct Funeral Expenses
- Funeral service costs
- Casket or cremation expenses
- Cemetery plot and burial fees
- Headstone or memorial marker
- Flowers and other ceremony costs
The average funeral in the United States now costs between $7,000 and $12,000, so many families choose coverage amounts in this range.
Additional Final Expenses
- Outstanding medical bills
- Credit card debt
- Unpaid loans
- Probate and legal fees
- Travel expenses for out-of-town family members
Peace of Mind Expenses
Some families use burial insurance proceeds to help with immediate living expenses during the grieving period, giving family members time to handle affairs without worrying about lost income.
How Much Burial Insurance Do You Need?
This is one of the most practical questions I help families answer. The right amount depends on several factors:
Calculate Your Final Expenses
Start by estimating your actual costs:
- Funeral service: $4,000-$8,000
- Casket: $2,000-$5,000 (or cremation: $1,000-$3,000)
- Cemetery costs: $1,000-$4,000
- Headstone: $500-$3,000
- Other expenses: $1,000-$3,000
Most families find that $10,000-$15,000 provides adequate coverage, though some choose higher amounts to cover additional debts or provide extra support for survivors.
Consider Your Current Resources
Before deciding on coverage amount, think about:
- Existing life insurance policies
- Savings specifically set aside for final expenses
- Social Security survivor benefits
- Veteran’s benefits (if applicable)
The goal is to fill any gaps between your estimated expenses and available resources.
Pros and Cons of Burial Insurance
Like any financial product, burial insurance has both advantages and limitations. Let me give you an honest assessment:
Advantages
Easy to qualify for - The simplified underwriting process means most people can get coverage even with health issues that would disqualify them from traditional life insurance.
Permanent coverage - Unlike term life insurance, burial insurance doesn’t expire as long as you pay your premiums.
Fixed premiums - Your monthly payment typically stays the same for life.
No beneficiary restrictions - Your beneficiaries can use the death benefit however they choose.
Quick payout - Claims are usually processed faster than traditional life insurance, often within days.
Disadvantages
Higher cost per dollar of coverage - Burial insurance typically costs more per $1,000 of coverage than term life insurance.
Limited coverage amounts - You usually can’t get more than $50,000, which might not be enough if you have significant debts.
Waiting periods on some policies - Guaranteed acceptance policies often have graded death benefits.
Cash value growth is minimal - While these are permanent policies, they’re not designed as investment vehicles.
Burial Insurance vs. Other Options
When families ask me about covering final expenses, I always make sure they understand all their options:
Burial Insurance vs. Term Life Insurance
Term life insurance offers much more coverage for less money, but only for a specific period (10, 20, or 30 years). If you’re young and healthy, term life insurance that extends into your later years might provide better value.
Burial insurance costs more per dollar of coverage but is permanent and easier to qualify for.
Burial Insurance vs. Whole Life Insurance
Whole life insurance provides permanent coverage with cash value growth, but requires medical underwriting and higher premiums.
Burial insurance is more accessible but offers less flexibility and growth potential.
Burial Insurance vs. Savings
A dedicated savings account earns interest and gives you complete control over the funds, but requires discipline and time to build up adequate funds.
Burial insurance provides immediate coverage from the first premium payment.
Who Should Consider Burial Insurance?
In my experience, burial insurance makes the most sense for specific situations:
You’re Between Ages 50-85
This is the sweet spot for burial insurance. You’re likely past the point where term life insurance makes sense, but you want to ensure your final expenses are covered.
You Have Health Issues
If you’ve been declined for traditional life insurance or would face very high premiums, burial insurance’s simplified underwriting can be a lifesaver.
You Want Small Amounts of Permanent Coverage
If you only need $10,000-$25,000 in coverage and want it to be permanent, burial insurance fills this niche perfectly.
You Want to Avoid Burdening Family
Even if you have some savings, burial insurance ensures your family won’t need to dip into their own resources or delay the funeral while waiting for other assets to be processed.
Common Myths About Burial Insurance
Let me clear up some misconceptions I hear regularly:
“It’s Only for Poor People”
This isn’t true. I work with families across all income levels who choose burial insurance for its convenience and guaranteed acceptance features.
“It’s a Scam”
While there are bad actors in any industry, burial insurance is a legitimate, regulated insurance product. The key is working with reputable companies and understanding what you’re buying.
“You Can Only Use It for Funeral Expenses”
The death benefit can be used for any purpose. While it’s designed for final expenses, beneficiaries have complete control over how they use the funds.
“It’s Always More Expensive Than Regular Life Insurance”
For young, healthy people, this is often true. But for older adults or those with health issues, burial insurance might be the only affordable option available.
How to Choose the Right Burial Insurance
If you’ve decided burial insurance makes sense for your situation, here’s how to find the right policy:
Compare Multiple Companies
Different insurance companies have different underwriting guidelines, premium rates, and policy features. What one company might decline, another might approve at standard rates.
Understand the Waiting Periods
If you’re considering guaranteed acceptance coverage, make sure you understand any graded death benefit periods and how they work.
Read the Health Questions Carefully
For simplified issue policies, review the health questions before applying. If you can honestly answer “no” to all questions, you’ll get immediate coverage at better rates.
Consider Your Premium Payment Options
Some companies offer discounts for annual payments versus monthly premiums. Others might offer family discounts if multiple family members apply.
Look at Financial Strength Ratings
Choose companies with strong financial ratings from agencies like A.M. Best, Standard & Poor’s, or Moody’s. You want to make sure the company will be around to pay claims.
The Application Process
Most burial insurance applications are straightforward:
- Complete the application with basic personal and health information
- Answer health questions honestly and completely
- Choose your coverage amount and beneficiaries
- Review and sign the policy documents
- Set up premium payments (usually monthly automatic deduction)
The entire process often takes less than 30 minutes, and you’ll usually know if you’re approved within a few days.
Making the Decision
Burial insurance isn’t right for everyone, but it serves an important purpose for many families. The key is understanding whether it fits your specific situation and goals.
If you’re healthy and younger, you might get better value from term life insurance. If you have significant assets, you might not need insurance at all. But if you want guaranteed, permanent coverage for final expenses and traditional life insurance isn’t accessible or affordable, burial insurance can provide valuable peace of mind.
The most important thing is making sure your family won’t face financial hardship during an already difficult time. Whether that’s through burial insurance, traditional life insurance, or other planning strategies, the goal is the same: protecting the people you love.
Finding the right life insurance doesn’t have to be complicated. As an independent agent, I work with multiple top-rated carriers and can help you compare options to find the best coverage at the best price.
Related Reading
- Burial Insurance for Seniors Over 70: Your Complete Guide
- Graded Benefit Whole Life Insurance: Your Complete Guide
- Burial Insurance for Seniors Over 80: Your Complete Guide
- Funeral Insurance for Seniors: Your Complete Guide
Let me do the shopping for you. I’ll compare quotes from multiple companies and help you find coverage that fits your needs and budget.
Get Your Free Quote Comparison
- Consider burial insurance if you’re between 45-85 and want to protect your family from funeral costs without the hassle of medical exams or complex underwriting processes.
- Choose simplified issue policies over guaranteed acceptance when possible, as they offer immediate coverage and lower premiums if you can answer basic health questions favorably.
- Expect smaller death benefits designed specifically for final expenses rather than income replacement, making burial insurance more affordable than traditional life insurance.
- Understand that guaranteed acceptance policies include waiting periods where your beneficiaries may only receive premiums paid back if you die from illness in the first few years.
- Apply while you’re healthy enough to qualify for simplified issue coverage, as your options become more limited and expensive as health conditions develop.
